Cash Credit

This account is the primary method in which Banks lend money against the security of mortgage of immovable properties. It runs like a current account except that the money that can be withdrawn from this account is not restricted to the amount deposited in the account. Instead, the account holder is permitted to withdraw a certain sum called “limit” or “credit facility” in excess of the amount deposited in the account. Cash Credits are, in theory, payable on demand.

Purpose

To meet the credit needs of trade, commercial activity, other general business, real estate as also for their bonafide requirements.

Eligibility

Persons having membership in the Bank, engaged in trade, commerce and business, Professionals, Self-employed, Prop. Firms, partnership firms, individuals with high net worth, salaried people, agriculturists, business establishments etc.

Security

The CC accounts are fully secured advances and sanctioned on the basis of:

Mortgage of immovable properties OR

Pledge of gold ornaments OR

Hypothecation of plant and machinery, stock of goods

FD receipt etc.

Normally, the CC is sanctioned against the security collateral immovable property such as land and building. The sanctioning amount will be limited up to 50% of the valuation of the collaterals.

If the CC is sanctioned on the basis of security of mortgage of immovable properties, the following documents must be produced and retained in the Bank:

The original document of the property.

Bank documents of the property or its duly attested copies.

Possession certificate of the property.

Encumbrance certificate of the property for the last preceding 15 years without any breaks.

Revenue Tax receipts of the property .

Purchase certificate issued by the revenue authorities (if found necessary).

Copy of the identity card as per the KYC norms.

Location map.